Ellis Don West Indies Ltd Plaintiff v The Urban Development Corporation Defendant [ECSC]
| Jurisdiction | St Lucia |
| Judge | Farara J |
| Judgment Date | 12 December 1997 |
| Judgment citation (vLex) | [1997] ECSC J1212-3 |
| Court | High Court (Saint Lucia) |
| Docket Number | SUIT NO: 695 OF 1997 |
| Date | 12 December 1997 |
IN THE HIGH COURT OF JUSTICE
(CIVIL)
A.D. 1997
Farara J (In Chambers).
SUIT NO: 695 OF 1997
This action was commenced by Writ of Summons indorsed with Statement of Claim issued 7th August, headed "Summary Proceedings Pursuant to Section 727 of the Code of Civil Procedure".
The Writ was served on the Defendant on 15th August, 1997 as appears from the indorsement of service thereon and the affidavit of service of Frederick Phillip filed 15th August, 1997.
I pause here to observe that the prohibition in Order 18 r.5 against service of pleadings during the Long Vacation, except with the leave of the court or consent of the Defendant, do not apply to a statement of claim indorsed on the Writ of Summons for although such a statement of claim is itself a pleading, a Writ of Summons is not caught by the definition of pleading.Supreme Court Practice 1979 paragraph 18/5/1 and Murray v Stephenson [1887] 19 QBD 60.
On 26th August, 1997 there being no defence filed or served, the Plaintiff lodged with the Registry of the High Court of Justice a draft judgment in default of defence for liquidated sum. The draft was approved by the Deputy Registrar on 2nd September, 1977.
Also on 2nd September, 1977 the Defendant filed a Summons for stay of the action ("Summons for Stay") under the Arbitration Act. The affidavit of Walter Downes was filed 4th September, 1377 in support of the Summons for Stay which was fixed for hearing on 24th September, 1977.
On 17 th September, 1977 the Plaintiffs solicitors filed the approved judgment in default of defence which was signed, thereby perfecting the said judgment for the sum of EC $5,581,931.00 and interest thereon at 2 percent per annum to date of payment and costs. The default judgment is headed or endorsed in this way: "Default Judgment in Action for liquidated demand (0. 13, r1; 0. 19, r2; 0. 42 r1)." This clearly shows that, although the proceedings were brought pursuant to Article 727 of the Code of Civil Procedure of St Lucia, the default judgment purported to be entered-up pursuant to the Rules of the Supreme Court 1970.
On 22nd September, 1977, some 4 days after the entering of the default judgment, the Defendant's solicitors effected service of the Summons for Stay and affidavit in support on the Plaintiffs solicitors. According to Counsel for the Defendant, there was some delay in getting the Summons out of the Registry.
On 8th October, 1977 the Defendant filed a Summons to set aside the default judgment ("Summons to Set Aside Judgment") together with the affidavit of Joseph Alexander, General Manager of the Defendant Company, in support thereof. The Summons to Set Aside Judgment was fixed for hearing on 15th October, 1977.
The Summons to Set Aside Judgment and supporting affidavit were served on 9th October, 1977 on the Plaintiffs solicitors, along with a notice informing of the adjourned date of 15th October, 1977 for hearing of the Summons for Stay, as there was no sitting of the court on 24th September, 1977.
On 10th October, 1977 the Defendant filed and served the supplementary affidavit of Walter Downes in support of the Summons for Stay exhibiting a copy of a letter dated 18th September, 1977 from Don Smith, the Project Manager of the Plaintiff to the Defendant (JA1). Also attached to the List of Exhibits, but not referred to in the supplementary affidavit, is a copy of a caution filed by the Plaintiff dated 22nd September, 1977 registered as instrument No.3687/97 at the Land Registry.
On 14th October, 1977 the Plaintiff filed two affidavits of Donald Richard Smith, General Manager of the Plaintiff Company, one in opposition to the Summons for Stay and the other in opposition to the Summons to Set Aside Judgment. Both affidavits, with exhibits, were served on Defendant's solicitors on 15th October, 1977.
At the hearing before me on 4th November, 1977 it was agreed by Counsel for the parties, that both summonses would be argued together, though not consolidated. The Summons for Stay was argued first.
The Defendant seeks a stay of all further proceedings in the action pursuant to Section 7 of the Arbitration Act, Chapter 14 of the Revised Laws of Saint Lucia, 1957, on the basis that the Plaintiff and the Defendant had, by an agreement dated 6th September, 1995, agreed to refer to arbitration the matters in respect of which this action was commenced.
"If any party to an arbitration agreement, or any person claiming through or under him, commences any legal proceedings in the Court against any other party to the arbitration agreement, or any person claiming through or under him, in respect of any matter agreed to be referred, any party to such legal proceedings may, at any time after appearance and before delivering any pleadings or taking any other steps in the proceedings, and the Court, if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement, and the applicant was, at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of the arbitration, may make an order staying the proceedings."
It is of importance to observe that Section 7 gives the Court a discretion whether or not to stay legal proceedings, and in order for that discretion to be envoked, the party applying for stay of proceedings must satisfy the Court of the following prerequisites:-
(a) both parties to the legal proceedings must be parties to an arbitration agreement or is claiming through a person who is a party thereto.
In the instant matter, the Plaintiff and Defendant are parties to the Agreement dated 6th September 1995(Exhibit DRS1) which provides in Clause 11 for the settlement of disputes by reference to conciliation or arbitration.
(b) the legal proceedings must related to matters agreed to be referred to arbitration.
The Agreement dated 6th September, 1995(DRS1) provides for the engagement of the Defendant, as building contractor, to carry out certain construction or building works in consideration of various payments which were to be made by the Defendant to the Plaintiff in accordance with certificates of practical and final completion issued by the engineer appointed by the Defendant.
Clause 11.1 of the Agreement provides for the settlement of any dispute or difference arising between the parties thereto (including a dispute as to any act or omission of the engineer) whether arising during or after completion of the works, in accordance with the other provisions of Clause 11.
This action pertains to a claim by the Plaintiff, as contractor, for various sums said to be owed by the Defendant under or pursuant to the Agreement and as certified by the engineer appointed thereunder by the Defendant.
(c) the application for a stay must be made after filing of an appearance in the action.
This prerequisite has also been satisfied by the Defendant, who first entered an appearance and subsequently filed the Summons for Stay.
(d) the application for stay must be made before delivery of any pleadings or the taking of any other steps in the action by the applicant.
The Defendant has not filed or served any defence or other pleading in this action, and the Summons for Stay was filed before any other step was taken by the Defendant, such as the filing of the Summons to Set Aside the Judgment.Lane v Herman [1939] 3 AER 353 (CA).
This is to be contrasted with cases in which the plaintiff, having sued and taken out a summons under RSC Order 14, the defendant files anaffidavit asserting a defence and subsequently applies for a stay of the proceedings under the Arbitration Act. In those circumstances, the defendant, although not initiating the application, will be said to have concurred in an application by the filing of his affidavit, and to have thereby taken a step in the proceedings prior to applying for a stay, which will accordingly be refused on that ground.
Pitchers Ltd v Plaza (Queensbury) Ltd [1940] 1 AER 151 .
Turner and Goudy v McConnell [1985] 2 AER 34 .
(e) the court must be satisfied that "no sufficient reason" exists why the matter should not be referred to arbitration in accordance with the arbitration agreement.
This aspect of the matter will be examined in detail later in the judgment both as to its legal meaning and application to the facts as disclosed by the affidavit and documentary evidence.
(f) the court must also be satisfied that the party applying for a stay was, at the time of commencement of the legal proceedings, and still remains ready and willing to do all things necessary to the proper conduct of the arbitration.
The Acting General Manager of the Defendant Company, Mr Walter Downes, at paragraph 7 of his affidavit filed 4th September, 1977 states:-
"At the time when the action was commenced the defendant was, and still remains, ready and willing to do and concur in all things necessary for causing the said matter to be decided by arbitration under the said agreement, and for the proper conduct of such arbitration."
This bare statement has not been supported by any steps, disearnable from the evidence, taken by or sought to be taken by the Defendant to bring to arbitration any of the matters the subject of this Suit.
It is clear from the authorities, that an applicant for stay must in his affidavit state and there must be some evidence to support the assertion that the applicant was and is ready and willing to have the matters in dispute referred to and determined by arbitration. Failure to do so may, in the absence of...
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